Employer NI for Apprentices (2026/27): Category H
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Employers pay 0% National Insurance on pay up to £50,270 for apprentices under 25 in 2026/27. The apprentice must be on an approved apprenticeship. The relief uses NI category H and ends when the apprentice turns 25 or finishes the programme. Try the calculator above, then check the rules, the saving and the set-up steps.
In this guide16 sections
Who qualifies
An apprentice counts for category H if all of these are true:
- They are under 25 on the date of pay.
- They are employed on an approved UK apprenticeship, following a government-recognised standard or framework.
- They have an apprenticeship agreement or commitment statement with you.
Someone on a training scheme that is not an approved apprenticeship, or on a short course, does not qualify. Placement students and interns need checking one by one.
How much you save
| Apprentice pay | Standard employer NI | Category H | Saving |
|---|---|---|---|
| £16,000 | £1,650 | £0 | £1,650 |
| £22,000 | £2,550 | £0 | £2,550 |
| £30,000 | £3,750 | £0 | £3,750 |
| £55,000 | £7,500 | £709.50 | £6,790.50 |
Most apprentices earn well under £50,270, so for them the employer NI is nil.
Under 21 or apprentice?
An apprentice under 21 could be placed in either category M or H. The employer rate is the same, 0% up to £50,270. The difference appears at 21. Category M ends at 21, while category H runs to 25 if the apprenticeship continues. So, for an apprentice aged 19, you use category H and the relief stays on until age 25 while they are on the apprenticeship.
Apprentice pay and the levy
Apprentice pay counts towards your pay bill for the apprenticeship levy, even though the NI rate is 0%. If your pay bill passes £3 million, you pay 0.5% on it. See the apprenticeship levy calculator. Smaller employers do not pay the levy, and can get government funding towards training costs.
| Employer NI | Apprenticeship levy | |
|---|---|---|
| Apprentice on £22,000 | £0 | Counts towards your pay bill, 0.5% only if your total pay bill is over £3 million |
When the relief stops
- The apprentice turns 25. Change the letter from the pay period after their 25th birthday.
- The apprenticeship ends. If the person stays on as a normal employee, move them to category A, or M if they are under 21.
- The apprentice leaves the programme early.
Step by step: setting up a new apprentice
- Confirm the apprenticeship is approved and the agreement is signed.
- Check the apprentice’s age.
- Set the NI category to H in your payroll software.
- Save the agreement and the start date.
- Diary the date they turn 25 and the programme end date.
Case study: a three-year apprenticeship
An apprentice is hired at 18 on £22,000, rising to £24,000 and £26,000.
| Year | Pay | Standard employer NI | With category H |
|---|---|---|---|
| 1 | £22,000 | £2,550 | £0 |
| 2 | £24,000 | £2,850 | £0 |
| 3 | £26,000 | £3,150 | £0 |
| Total | n/a | £8,550 | £0 |
The employer saves £8,550 across the programme. If the apprentice stays on after year three at £28,000, the employer pays £3,450 a year in NI, unless they are under 21. See under-21 relief.
A business with several apprentices
A training company has 8 apprentices on £21,000 and 4 qualified staff on £32,000.
| Group | Staff | Employer NI each | Total |
|---|---|---|---|
| Apprentices (H) | 8 | £0 | £0 |
| Qualified staff (A) | 4 | £4,050 | £16,200 |
| Bill before allowance | £16,200 | ||
| After Employment Allowance | £5,700 |
Without category H, the apprentices would add £19,200 to the bill. See Employment Allowance.
Mistakes to avoid
- Applying category H to a short course that is not an approved apprenticeship.
- Forgetting to change the letter at 25.
- Not keeping the apprenticeship agreement.
- Assuming the relief covers the apprenticeship levy. It does not.
Hiring an apprentice: the full cost
Employer NI is only one part of the cost. A £22,000 apprentice costs £22,000 plus a minimum pension, equipment and the time of the person who supervises them. Training costs may be covered in part by government funding. Use the cost calculator to build the total, and read the exemptions guide for other reliefs.
| Item | Annual cost |
|---|---|
| Salary | £22,000 |
| Employer NI (category H) | £0 |
| Employer pension at 3% of qualifying earnings | £472.80 |
| Total before supervision, equipment and training | £22,472.80 |
What happens when the apprenticeship ends
When an apprenticeship finishes, the apprentice often becomes a regular employee. The NI position changes on that date.
| Apprentice’s age at end | Pay | Category after | Employer NI per year |
|---|---|---|---|
| 19 | £26,000 | M (under 21) | £0 |
| 22 | £26,000 | A | £3,150 |
| 24 | £26,000 | A | £3,150 |
An apprentice who finishes at 19 stays free of employer NI until 21. One who finishes at 22 moves straight to the full 15% on pay above £5,000. Budget for this when you offer a permanent role.
Funding for apprentice training
Employers who do not pay the levy can usually get the government to fund most of the training cost for apprentices. Levy payers use their levy funds. Neither route affects the NI relief. The two are separate. See the apprenticeship levy calculator for the levy side.
Questions to ask a training provider
- Is the course an approved apprenticeship standard?
- Will you provide a written agreement and training plan?
- How will you tell me if the apprentice leaves or pauses the course?
- What evidence will you give me for NI purposes?
Frequently asked questions
What is the employer NI rate for apprentices?
0% on pay up to £50,270 a year, then 15%.
What category letter should I use for apprentices?
H, for apprentices under 25 on an approved apprenticeship.
Does the relief apply to apprentices over 25?
No. At 25, the standard rate applies.
Is the apprentice’s own NI affected?
No. The apprentice pays 8% above £12,570, like other employees.
Do I still pay NI if my apprentice earns over £50,270?
Yes, 15% on the part above £50,270.
Do I need to tell HMRC?
No. You set the category letter in payroll. Keep your records in case of a check.
Is the apprentice’s training cost covered by the NI relief?
No. The NI relief only reduces employer NI. Training costs are funded separately.
Can I pay an apprentice more than the minimum?
Yes. NI relief applies to all pay up to £50,270.
What happens if the apprentice passes their final assessment early?
Change the letter when the apprenticeship ends, from the next pay period. The relief depends on the apprenticeship being in place.
Can a veteran or under-21 also be an apprentice?
Yes, but only one category applies at a time. The 0% limit is the same.
Related guides
- Employer NI Exemptions and Reliefs 2026/27
- Employer NI for Under 21s (2026/27): 0% to £50,270
- Apprenticeship Levy Calculator 2026/27
- NI Category Letters for Employers (2026/27)
- Cost of Employing Someone UK 2026/27: Calculator
Official sources
This page is independent information, not tax advice, and has no link with HMRC. Figures were checked on 20 October 2026 for the 2026/27 tax year. Always confirm the final figures with HMRC or your payroll provider.
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